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Research Alert: CFRA Reiterates Hold Opinion On Shares Of Service Properties Trust

05/10/2021 11:57

03:50 PM EDT, 05/10/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We maintain our target price of $13 per share and lower our FFO per share estimates by $1.00 to $0.41 for 2021 and by $0.10 to $2.22 for 2022. SVC reported a Q1 FFO per share loss of ($0.26) vs. $0.75, $0.17 below consensus. For Q1, comparable hotels occupancy averaged 40.1% and ADR of $87.19 resulting in RevPAR of $34.96, which was still down 51% from the same period last year, but we note all of these metrics have been improving and accelerated through the months in Q1 and into April with occupancy hitting 51.0% in April and RevPAR at $48.38. For the net lease portfolio, occupancy was 98.5% and SVC collected 93.1% of Q1 rents. SVC faced the continued Covid-19 disruptions in the quarter but also the previously announced transitioning of over 200 hotels to Sonesta management over the last two quarters. We think the hotel transition will pass but SVC will continue to face lower occupancy. SVC has reduced its cash burn rate to $16 million per month and expects to turn cash flow positive by Q3.